Hovid posts 47% dip in net profit

PETALING JAYA: Pharmaceutical firm Hovid Bhd, which is in the midst of a conditional voluntary takeover by its major shareholder, has registered a 47% dip in its net profit for the first quarter ended Sept 30 compared with the previous corresponding quarter.

In a Bursa Malaysia filing yesterday, it said the lower profit was due to a higher proportion of tender sales, higher operating expenses including utilities and fuel as well as an increase in foreign-exchange losses of RM1mil arising from a weaker US dollar.

This was on the back of RM49.6mil revenue, which was 12.5% higher compared with the previous corresponding quarter.

Hovid said all production plants were operating 24 hours a day during the quarter under review to deliver back orders received during the period when some licences were revoked.

In January, the Health Ministry had repealed the manufacturing licences of both of Hovid’s facilities in Perak.

“Barring any unforeseen circumstances, the outlook for the group is expected to be satisfactory, given that the group is expanding its tablet and capsule production facility, which will be commissioned towards year-end.

“The group is also actively securing new overseas markets and registration of new products.

“However, the fluctuation of the ringgit against the US dollar and the resulting unrealised foreign-exchange gains or losses may cause some fluctuations to our ringgit-denominated financial results, together with the increase in depreciation and interest expense arising from the new expansions,” it said.